Indian real estate attracts record $8.87 billion institutional investments in 2024: JLL India

Institutional investment in Indian real estate rose 51 per cent to a record USD 8.87 billion during 2024 as investors look to encash strong demand for housing, office and warehousing properties, according to JLL.

In its report released on Wednesday, real estate consultant JLL India has estimated the institutional investment in Indian real estate at USD 8.878 billion in 2024 compared to USD 5.878 billion in the preceding calendar year.

Foreign institutional investors accounted for 63 per cent of the total institutional investments in Indian real estate.

Among different asset classes, the residential segment attracted 45 per cent of inflows followed by office buildings 28 per cent and warehousing properties 23 per cent.

"The year 2024 marks a milestone for India's real estate sector, with institutional investments hitting USD 8.9 billion across 78 deals. This figure stands as the highest on record, eclipsing the 2007 peak of USD 8.4 billion," the consultant said.

The deal activity intensified, and the year 2024 saw an increase in number of deals by 47 per cent.

Lata Pillai, Senior Managing Director & Head of Capital Markets, India, JLL, said, "Strong growth, political stability, and diverse investment opportunities positioned India favourably in the global economic context.

"The real estate sector has seen a surge in institutional investments." 

She highlighted that a notable shift is the increasing participation of domestic domiciled investors since 2023 and this trend appears to continue in 2024 with them contributing 37 per cent share compared to an average of 19 per cent between 2019-2022.

Pillai said the REITs in India have seen a substantial surge in activity recently. Their investments in 2024 reached nearly USD 800 million, marking a more than three-fold increase from 2023 levels.

"Looking ahead, QIPs are expected to play a significant role in capital raise as the market is likely to see an increase in newly listed players," she said.

JLL India said that the residential segment is now capturing the spotlight, attracting a larger share of investor capital.

"Office investments have experienced a downturn in 2024, with a 17 per cent decrease compared to 2023," the consultant said.